Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned positive in the current quarter after a negative prior quarter, but remained substantially lower than the same quarter last year. The improvement was supported by a reduction in capital expenditure, while operating cash flow was relatively stable compared to the prior quarter.
- Revenue was lower than both the prior quarter and the year-ago quarter. Operating cash flow decreased slightly from the prior quarter and significantly from the year-ago quarter. Capital expenditure was lower than both comparison periods. As a result, free cash flow margin improved from negative to positive, but remained far below the year-ago level.
- Compared to the immediately preceding quarter, free cash flow improved from negative to positive, driven by lower capital expenditure. Compared to the same quarter one year earlier, free cash flow was substantially lower due to a significant decline in revenue and operating cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$986.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$83.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$506.0M
Cash generated by operations before capital spending.
CapEx
$423.0M
Capital spending and related asset purchases.
FCF margin
5.5%
The share of revenue converted into free cash flow.
Cash flow trend
A short quarterly history shows whether FCF is scaling with revenue or only spiking for one period.
| Period | Revenue | Operating CF | CapEx | FCF | FCF margin |
|---|---|---|---|---|---|
| 2022-12-31 | $4.1B | $1.1B | $524.0M | $526.0M | 12.7% |
| 2023-03-31 | $3.4B | $889.0M | $497.0M | $392.0M | 11.6% |
| 2023-06-30 | $1.9B | $515.0M | $530.0M | -$15.0M | -0.8% |
| 2023-09-30 | $1.5B | $506.0M | $423.0M | $83.0M | 5.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 118.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 28.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | n/a | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Capital expenditure reduction
Capital expenditure decreased compared to the prior quarter and the year-ago quarter, which helped free cash flow turn positive.
The lower capital expenditure was the primary factor enabling the positive free cash flow in the current quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than both the prior quarter and the year-ago quarter. Operating cash flow decreased slightly from the prior quarter and significantly from the year-ago quarter. Capital expenditure was lower than both comparison periods. As a result, free cash flow margin improved from negative to positive, but remained far below the year-ago level.
Compared to the immediately preceding quarter, free cash flow improved from negative to positive, driven by lower capital expenditure. Compared to the same quarter one year earlier, free cash flow was substantially lower due to a significant decline in revenue and operating cash flow.
Monitor the trajectory of operating cash flow, as it declined from both the prior quarter and the year-ago quarter.